New Global Survey Reveals The Most Ethical (And Unethical) Countries To Do Business In

Japan topped the list as the most ethical country in which to do business. (Photo: Kazuhiro Nogi /AFP/Getty Images)

What do Japan, Spain and Germany have in common? And what do Russia, Brazil and India have in common?

They're at the top and bottom, respectively, of a new global survey.

Japan, Spain and Germany have the least amount of misconduct observed by employees, while Russia, Brazil and India have the most amount of misconduct observed by employees. ("Misconduct" is defined here as violation of the law, organizational values or universal ethical principles such as fairness and honesty.)

It's a comprehensive, substantive, 54-page report, and I'd recommend it to anyone interested in the subject. The report includes findings from 13 countries. In addition to the six countries noted at the outset, the other seven are China, France, Italy, Mexico, South Korea, U.K and the U.S. The U.S. was in the middle of pack, with 30% of employees observing "rules violations at work" -- compared with only 15% observing violations in Japan and 45% in Russia.

Among the study's key findings:

"Pressure to compromise standards" is a key link in a problematic chain: "Pressure to compromise integrity is widespread," the report states, "foreshadowing future misconduct." In short, it's a bad ethical omen. "Nearly three-quarters (a median of 73%) of all public and private sector employees surveyed who felt pressure also said they witnessed misconduct where they worked. In the absence of pressure, by comparison, a median of only 17% said they observed misconduct in their place of business."

Similar patterns of bad behavior: What kind of problems are most common? "Around the world people behave badly in similar ways," the report observed. "Economic conditions, local customs and and national cultures differ, but when it comes to workplace behavior, a few types of misconduct predominate everywhere. Although much of the conversation focuses on high-profile problems such as bribery and fraud, the most common issues involve problematic communication and poor conduct in day-to-day relationships. Employees in nearly every country citedlying to employees, customers, vendors or the public and abusive behavior more frequently than other forms of misconduct."

To give a sense of scale, "lying" was reported, for example, by 11% of employees in Japan, 22% of employees in the U.S., 26% in China, 28% in Italy, 30% in France, 31% in Russia, 33% in India and 37% in Brazil. China, the report noted, was overall an interesting exception. "As in other countries," stated the report, "lying on the job was an issue in China among both private and public sector respondents; however, violations with greater implications for the supply chain, such as offering bribes and hiding potential regulatory infractions, were more common than abusive behavior."

I believe the report's insights can have value for any organization considering global expansion, or to better understand environments in which they're already doing business.

The responsibility of management: With respect to defensive tactics, the report noted, "Organizations can combat misconduct by focusing their efforts on a few behaviors that are commonplace -- abusive behavior and lying. Perceptions can vary broadly by location and culture. Explore the communication and specific behaviors that are a problem. Through focus groups, employee surveys or other proven methods, understand what employees are experiencing (both the positive and the negative) and how they perceive the ethics-related actions of their leaders and supervisors."

Not surprisingly, the report emphasizes the critical role of senior management (as I would entirely expect) in setting an organization's ethical tone. "Employees tend to follow leaders' cues for both good and ill, which makes it especially problematic when leaders break rules or violate standards of integrity."

Yes indeed. Leadership character is always a difference maker. In my experience this is the heart of the matter.

* * *

Over two decades of Fortune 500 management experience. My book is "The Type B Manager" and my online Udemy courses are "The Manager's Mindset" and "How to Manage Difficult Employees." Long interested as practitioner in the subject of management, both good and bad, effective ...